Ryan Reynolds has become more than just a Hollywood A-lister; he's also ventured into the world of investing with a series of high-profile business moves. From selling two companies for billions to owning a Welsh football club, Reynolds appears to have the Midas touch. However, a closer examination reveals that while he has enjoyed significant successes, not all his ventures have been equally fruitful.
The Highs: Mint Mobile and Aviation Gin
One of Reynolds' most notable successes is his investment in Mint Mobile, a low-cost prepaid phone provider. In 2019, Reynolds acquired a 25% stake in the company and became its public face through engaging advertising campaigns. His involvement helped Mint Mobile skyrocket in popularity, leading to its acquisition by T-Mobile (TMUS) for a staggering $1.35 billion in March 2023. The deal, approved by the FCC in April 2024, was structured with 61% stock and 39% cash, and Reynolds remains involved as a spokesperson.
Similarly, Reynolds found success with Aviation American Gin. In 2018, he acquired a stake and took on the role of creative director, injecting his signature humor into the brand's marketing. In 2020, global spirits giant Diageo (DEO) acquired Aviation Gin in a deal worth up to $610 million, contingent upon the brand's performance over the next decade. Reynolds retained an ongoing ownership interest and continues to be involved in its promotion.
The Underdog Story: Wrexham AFC
In early 2021, Reynolds teamed up with fellow actor Rob McElhenney to purchase Wrexham AFC, a Welsh football club, for $2.5 million. Their ownership has revitalized the team, leading to promotions and increased global interest, partly thanks to the "Welcome to Wrexham" docuseries. However, maintaining a competitive team has required significant investment. For the year ending June 30, 2023, Wrexham reported losses of $6.4 million due to increased payroll expenses. While the venture has been a cultural success, its long-term financial profitability remains to be seen.
The Lows: Less Successful Ventures
Despite these high points, not all of Reynolds' investments have yielded positive results.
- Nuvei Payments (NVEI): In April 2023, Reynolds acquired a stake in this Canadian fintech firm when shares were around $42. By April 2024, the company was acquired by Advent International for $34 per share, suggesting a potential loss on Reynolds' investment.
- Wealthsimple: Reynolds participated in a 2021 funding round that valued the Canadian fintech company at $5 billion CAD. With the market downturn, the company's valuation is believed to have decreased significantly, impacting investors like Reynolds.
- 1Password: Reynolds invested in this cybersecurity firm during a 2022 funding round that valued it at $6.8 billion. While the company remains private, the tech market's volatility raises questions about its current valuation.
- FuboTV (FUBO): Reynolds entered into a deal with FuboTV in August 2022, receiving equity in exchange for creating content for a new channel. Since then, FuboTV's stock price has declined sharply, putting the value of his equity stake in jeopardy.
- Alpine F1 Racing: In June 2023, Reynolds joined a celebrity consortium to acquire a 24% stake in the Alpine F1 Racing Team for $218 million. Critics argue that the team was overvalued, and its performance has yet to justify the hefty price tag.
- Match Group (MTCH): Serving on the board since 2020, Reynolds has seen the company's stock struggle amid stiff competition and governance concerns.
It’s largely unclear how much Reynolds invested in any of these ventures, but it’s still early for most of these investments. For example, 1Password and Weathsimple are both pre-IPO startups, which typically take 5 to 10 years or more before investors see a return. And sports teams like Alpine F1 Racing and Wrexham can often be more of a passion project than a for-profit venture. Further, the large exits Reynolds has seen likely more than makeup for his poor investment, not accounting for an illustrious acting career.
The Reality Behind the Headlines
While media coverage often highlights Reynolds' successes, it's important to note that some of his celebrated deals are more nuanced than they appear.
- Deal Structures: Both the Mint Mobile and Aviation Gin acquisitions included significant earn-out provisions and stock components, meaning that the headline figures are not entirely cash and depend on future performance.
- Continued Involvement: Acquirers like T-Mobile and Diageo have required Reynolds to remain involved post-acquisition, suggesting that much of the brands' value is tied to his personal endorsement.
Ryan Reynolds has undoubtedly made savvy moves that have paid off handsomely, particularly with Mint Mobile and Aviation Gin. His hands-on, creative approach to marketing has differentiated him from other celebrity investors and added tangible value to his ventures.
However, not all his investments have been home runs. Some have underperformed or carry risks that aren't immediately apparent. This mixed track record doesn't diminish his successes but offers a more balanced view of his investment prowess.
Reynolds himself remains humble about his business endeavors. "I wouldn't characterize myself as an entrepreneur," he told The Wall Street Journal. "I would characterize myself as someone who has found a couple of different things in life that I believed in with every cell in my body."
As he continues to explore new ventures, Reynolds' story serves as a reminder that even for celebrities, the world of investing comes with its highs and lows. Success requires not just star power but also strategic thinking, due diligence, and sometimes, a bit of luck.
On the date of publication, Caleb Naysmith did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
